NewsIndustry NewsOntario considers making large emitters pay for pollution if standards exceeded

February 13, 2019 – Ontario is considering having large industrial companies pay for pollution if they exceed emissions standards that will be established in the province – a system critics say is the same as the federal carbon tax the government has railed against for months.

The Progressive Conservative government posted a proposal for the system on Ontario’s Environmental Registry on Tuesday as part of its plan to fight climate change.

Under the proposal, which is open for public comment, the province would set sector or facility-level greenhouse gas emissions standards rather than an absolute cap on emissions.

The system could make companies that exceed emissions standards pay for “compliance units,” which start at $20 per tonne. The price of the units would increase by $10 a year until they max out at $50 a tonne in 2022.

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“Our environment plan put forward responsible, tangible solutions that take into consideration the unique circumstances of our economy and the environment,” Environment Minister Rod Phillips says in a statement.

Premier Doug Ford’s government scrapped the previous Liberal regime’s cap-and-trade system after being elected last year, and launched a court challenge opposing the imposition of a federal carbon price on the province.

The federal carbon tax, which goes into effect April 1, will be imposed on provinces that don’t have their own carbon pricing plans.

Ford has repeatedly said a carbon price would hurt the economy and generated controversy last month when he suggested the federal carbon tax would cause a recession. Opponents and economists called his claim baseless.

The government’s proposal issued Tuesday said payments collected from large emitters through the program would be placed in a fund that could be used by industry to support greenhouse gas reduction projects.

The plan would be in place by summer 2019, the government’s proposal says.

Greenpeace Canada said the proposed system essentially puts a price on carbon.

“The government can rail against carbon taxes and say how evil they are but this is basically what they’re doing here,” says Keith Stewart, the group’s senior energy strategist.

“They’re saying polluters are going to have to pay for a small portion of their emissions. They can get that money back to invest in greenhouse gas reductions measures, just like the federal program.”

Stewart says the province is attempting to preempt the imposition of the federal carbon price on industry by meeting the minimum threshold set by the Trudeau government.

“They know they’re going to lose (their court challenge) so they’re basically bringing in their own version of the federal price to avoid having systems coming and going,” he says.

Advocacy group Environmental Defence also said Ontario’s proposal looks similar to the federal government’s carbon pricing system.

“This proposal raises an important question: Why is Ontario fighting a price on carbon one day, and proposing one the next?” Sarah Buchanan, the organization’s clean economy program manager, says in a statement.

“What Ontario really needs is a system that is consistent and effective at reducing emissions, not months of posturing, legal battles, and uncertainty around which rules to follow.”

Federal Environment Minister Catherine McKenna said the Ford government has not made fighting climate change a priority and that has resulted in “huge cost and significant uncertainty to business.”

“Starting this year, it is no longer free to pollute anywhere in Canada,” she said in a statement Tuesday. “We have been very clear for provinces that didn’t put a price on pollution, the federal system will stay in effect until at least 2022. This provides certainty to businesses and creates the incentive for them to innovate, reduce emissions and create good jobs.”

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